Because I’m not convinced it does. I’ve consistently gotten much better deals than the best dealer offer after cross shopping dealers. How do I know? Because on multiple occasions I have cross shopped multiple dealers and then came in with my own offer that was significantly better and had it accepted. Is that anecdotal? Absolutely, but I can’t offer anything better than my repeated experience.
Further, how does one know if the dealer is offering a good deal without sorting out what a good deal is? Do you take the best deal from every dealer in 5 miles? In 10 miles? In 100 miles? What if you can save significant money by going a bit further a field?
This is all a long way of saying “shop for a 5 figure purchase without spending the time to figure out what a good deal actually is and just hope that the dealers give you their best price” vs “if you’re going to spend 5 figures on something, spend an hour to learn a bit about pricing on it.”
Would anyone go into any other transaction of this size blind?
You tell the various dealerships whom you are vetting to give you their monthly payment with only first month’s payment DAS. That’s it. No drive-off’s up front, no fees, no taxes, nothing. You have them roll all that into the monthly payment. Now you have a true apples-apples comparison way to shop for a particular car, assuming MSRP is equal across the dealerships. You don’t have to worry about what they charge for doc fees, MF markups, dealer fees, etc. You simply multiply the monthly payment by the number of months of the term and voila, that is your total cost. Whichever dealer has the lowest total cost wins your business. It matters not how they got there. It’s really that simple.
Some of you claim that a dealership may forget to give you an incentive. Really? You’ve told all the dealers what incentives you qualify for up front, so it’s up to them to work it into their deal.
Once I get the lowest price I can squeeze out of a dealership, I THEN run it through the LH calculator just for sh1ts and grins to see how far below MSRP I got. I have a % in mind just from researching prior deals on this website.
I’m just a consumer, and for me this is the easiest way to negotiate. It’s all about keeping it apples to apples. My tiny brain can easily compare monthly payments to arrive at the best deal.
As I said, you do have to know all the incentives that you qualify for and tell each dealership beforehand what they are so that they can give you their best offers.
Now, I’m not saying that is a normal occurrence, but it’s just another way where breaking down the dealer offer worked in my favor and blindly picking the lowest offer would have cost me money.
I have, however, seen an lot of cases of someone going in and getting the ol “oh, those numbers didn’t include your tax rate” or “that didn’t include your registration cost” etc
Thats true…ppl always say to negotiate with the internet sales person of the dealership…all bs… they want every bit of info on your life b4 they talk numbers…then they want u in.
Its almost impossible to lock anyone into a internet quote…especially when the person u are communicating with has no authority to quote prices.
I am trying to work a deal on a new Ford Explorer and I told dealer I’d be willing to put about $2K towards drive off fees.
When giving me my first quote, the dealer just put “$2k down” and then showed the the fees broken out with my monthly payment - including acquisition (quoted at $645), conveyance (quoted at $699), and registration fees (quoted at $250).
So is putting down $2K different than applying $2K towards fees, etc., or is that them showing the same thing in a different way?
Also, are there certain fees and rates I should be trying to negotiate other than the MF and RV (I checked Edmunds so I know what those are supposed to be)? The $700 conveyance seems high, but is also common here in CT.
In most cases when a dealer asks “how much do you want to put down?” they are referring to total due at signing (not a true ‘down payment’ per se).
In this case it is just semantics in the dealer’s quote sheet, there is no difference in “$2k total down” versus $2k due at signing to cover some/all of the fees.
And most all dealer fees cannot be negotiated, the only thing you can do is push for a larger discount to offset any fees. I’m not familiar with a conveyance fee, is this just a fancy name for a doc fee? If so then see above re: it’s non negotiable.
Thank you for the info! I’m not sure what it is. They call it “conveyance fee” here in CT, perhaps that a documentation fee? It would make sense.
Interestingly, with a certain pricing plan through work, it lowered this fee from $700 to $100 because fees are capped thru the program. I’m not sure if that means it’s negotiable or if the manufacturer is kicking back that $600 to the dealer.
On this topic, I was working on a 2024 Tundra lease - Memorial Day 2024. I went for a Toyota sponsored lease $569 / month (+TTL) & $3,999 down. It had a Net Cap Cost of $50,xxx for a Toyota Limited with a SRP of $63,xxx, but the MF was somewhere around .00475 11%(!). The dealer staff pretended they didn’t know anything about it. I had to show the sales guy and two sales managers the offer - right there on Toyota’s website. They knew what it was, they just didn’t want to sell it. They countered with their own offer: Limited 4x4 TRD Off Road and the MSRP was $67,300 (advertised at $63,xxx w/ dealer discount) and Net Cap Cost was $59,7xx with $4k DAS with a MF of .00155. Of that $4k was $1,300 of TTL+docs. A trade-in component of the deal fell-through (5 months left on my Honda Ridgeline lease and they wouldn’t match the buyout of $33.5k), so I returned later in the week and suggested reducing the Net Cap Cost to $57,2xx and the DAS to $1,500 and bumping the MF to .00225 for effectively a net-zero change. (I took the car buyout off the table because I didn’t want to pay out $4k DAS if they weren’t going to buyout my Ridgeline). The dealer wouldn’t do it -said he was already losing money (sure). I think my counter offer was too close to his invoice cost and he wasn’t making the minimum profit margin they established. Is it correct that they sell the truck to Toyota Financial Services (when leasing) and get a small piece of the rent charge, so cash included at DAS and a higher Net Cap Cost is their bread & butter? This coincided with the same day when Toyota announced the Tundra engine recall for 22-23 and possibly more. Coincidentally, they dropped their advertised pricing of the truck another $1,000 the day after Toyota made the recall announcement. So, I’ll wait until Labor Day and see how things progress - I’m shopping Tundra vs F-150.
Interesting point about the DAS. I attempted to offset the bigger discount with an increased MF (.00155 >> .00225) that would make up for the $2,500 DAS reduction over the 36 month lease. Really surprised me that they would turn down the increased MF. So, something tells me that the Dealership cut on the MF is not as significant / valued as the difference in the Net Cap Cost / sell price to TFS. They want the highest Net Cap Cost they can get - they want their cash now, not over time.
There is often a cap of how much the money factor can be marked up. I dont know what it is for TFS. They also don’t always get a 1 for 1 participation on the mark up. I recall seeing that for ccap, at least, where the dealer only gets 75% of the mark up as participation.
It may also go against their internal metrics for how much discount they’re allowed to show. Some dealers won’t do big discounts as a rule, even if in their interests, because they don’t want to develop a reputation in their local markets for heavily discounting.
MF is the way the bank makes their money, sale price is how the dealer makes the money. With an marked up MF, the banks gives a portion of the MF back to the dealer. Both the markups and the MF are decided by the bank and might not be under the control of the dealership.
Increasingly, financial products are where the individual opposite you makes their money via commission and compensation structure.
So, two exact same TCO leases, one with a higher MF and one with a lower discount, it’s more likely the one with the higher MF will get greenlit by the person in charge. Ofc there are limits set by the bank on MF markups.
